I'm with lemmy.world and I can still see beehaw recent posts and I can interact with them despite us being mutually defederated. How does this actually work?
Beehaw has very strict moderation, like a traditional forum. They want a small, closed community where they can look out but nobody else can come in. (They've even mentioned they would switch to an allowlist if it could be made one-way.)
Lemmy.world and sh.itjust.works had easy sign-ups and Beehaw said the ease of sign-ups were responsible for a lot of trolls and bad actors. So Beehaw defederated from both those instances until they made sign-ups harder.
It was because lemmy.world was experiencing explosive growth and did not have a good mechanism in place to limit spam and troll accounts. This combined with Lemmy's still infant moderating tools made it difficult for Beehaw to contend with the influx of lemmy.world users who were harassing beehaw users.
A mutual decision was made between both beehaw and lemmy.world to temporarily defederate while the moderation tools are worked on. They fully intend to re-federate once these tools are in place, as both instances have a fairly similar attitude towards harassment and hate speech.
There was no disagreement between the admins of beehaw and lemmy.world
I think it's also important to understand that defederation is a key feature of the fediverse, not something necessarily bad. It allows us to create interconnected communities that fit the needs of different people.
Beehaw and Lemmy.world have similar goals but different strategies, so they defederate so that Beehaw won't have to be subject to moderation issues facing Lemmy.world. That's perfectly fine - Beehaw are not morally obliged to receive content from Lemmy.world. Their users know the content policy of the page, and choose to stay out of their own free will.
Another server might have their own intolerances, even seemingly problematic ones like blasphemy or the letter e. They're free to defederate as they see fit.
This is not breaking the fediverse - it's a major feature of the fediverse by design.
And there's a way around it. Make two accounts so you can see both sides of the "disconnected" instances. The biggest problem with that was how to duplicate your existing account to make it feel more seamless, but already someone has begun a tool to help do most of that for you. One step closer to some type of universal login, at least through Lemmy instances. The caveat is that it now falls on the user to make sure they know where they're posting and what rules that are part of the defederation they should avoid breaking.